I have had occasions to install Windows 7 using a USB. You may want to do this if your cd-rom is failing or if you have a netbook.

How-To-Geek has a great article on how to make a bootable usb flash drive.

Full Article Here: http://www.howtogeek.com/howto/9585/how-to-setup-a-usb-flash-drive-to-install-windows-7/